"This debt is like a cancer. It
is truly going to destroy the country from
within." Erskine Bowles (former
White House Chief of Staff in Clinton Admin)

"Greetings from the decaying and
dying City of London
where the trained eye can witness the end
of 300 years of Anglo global domination.
They will not let go without a fight so
the fight is being carried to them in full
force." -- Banker & Consultant

"The definition of insanity is
doing the same thing over and over again
and expecting different results."
-- Albert Einstein (who never knew Greenspan,
Rubin, Dimon, or Geithner)

CRITICAL
TIDBITS

◄$$$ BANKERS ARE PART OF THE USDOLLAR
DEFENSE. PARADIGM SHIFT IS A PART OF THE
CURRENCY WARS IN A LATE STAGE, THE REJECTION
PHASE. JESSE BOLDLY ADDS MEAT TO MY CLAIM
THAT THE USDOLLAR IS DEFENDED BY MILITARY
MIGHT, NOT ONLY ECONOMIC POWER. HE EXPECTS
THE AMERICAN BANKSTERS TO BECOME FUGITIVES
FROM JUSTICE, AND FOR THE DEATHS TO BEGIN.
$$$

The Paradigm Shift has not stopped or been
de-railed, only gone quiet. Let Jesse speak
his words, since they are so pointed and
well focused. His views on the edge of radical,
but almost all events in the last two or
three years have been extremely extreme.
He wrote, "As I noted last year,
the [IMF] Special Drawing Right recalibration
would be a focal point for the BRIC's to
attempt to dislodge the dollar hegemony.
The US and UK are fighting it with their
bag of financial tricks. This is why Obama
refused to touch the gangs of New
York in his so-called reforms. The big
banks and hedge funds are as much an instrument
of US foreign policy as is its military. Europe
is learning this lesson, and it is taking
measures to protect itself. This is part
of the long range forecast, and is known
as the Currency Wars. I will not be surprised
at all if in the next ten years certain
US
officials and those who claim to have been
acting on its behalf, merely following orders,
become fugitives from justice. But there
may be some suicides and tragic airplane
accidents among the weaker links first,
if things get dodgy. And of course the usual
scapegoats, fall guys and patsies."
See the Cafe Americain article (CLICK HERE).
My best European banker source has repeated
his expectation that in due time, a Nuremberg
type trial of Western bankers, in particular
the American and British bankers, will occur
on European soil. The International
Court in the
Hague is actively pursuing justice right
now. He has seen arrest warrant lists by
Interpol. Delivery of such warrants is where
the battles will be explosive. Timing is
everything. How about at a Davos Meeting??

◄$$$ A TITANIC STRUGGLE IS TIED TO
THE PARADIGM SHIFT AWAY FROM THE USDOLLAR
SPECIFICALLY AND FIAT CURRENCY GENERALLY.
NEW YORK AND LONDON
ARE TO SLIDE INTO OBSCURITY AND BACKWATERS,
WHICH SOME APTLY DESCRIBE AS MOVING TOWARD
THE THIRD WORLD. $$$

A global banker with heavy gold and international
consulting experience shared a note recently
that was chilling. It speaks to the Paradigm
Shift, the displacement of the USDollar,
and the slide from grace that has befallen
New York and London. Profound
bond fraud was their calling card, and USDollar
rejection will be their wages. The revisited
Tale of Two Cities recognizes them no longer
as power centers, but of fraud centers,
where desperate market manipulation continues
to the end. The deep source wrote from London, whose changes are perceived by him over time. He wrote, "They
can slice and dice it whichever way they
like. However, someday before long their
corrupted financial system will inevitably
collapse since the entire system is about
to implode. The current power struggle
that goes on at the highest level is unprecedented.
The gloves are off and no prisoners are
being taken. Paradigm change at its finest,
as the plugs on the holograms are being
pulled that will only allow those to survive
and succeed who have a well honed inner
compass and absolutely no dependences on
any one group. The art of using power
is that everyone at the table knows you
have power but no one really wants to find
out how much and what happens to him/her
once you decide to direct your power against
them. There are only a very few who
are battling it out and each player in that
battle knows that he/she might not belong
to those who will survive. If looked at
from a sportive point of view, one can even
see an entertaining aspect to it all. Greetings
from the decaying and dying City of London,
where the trained eye can witness the end
of 300 years of Anglo global domination.
They will not let go without a fight. So
the fight is being carried to them in full
force. Once all is said and done, the City
of London is ready to become a subsidiary of Disney Corporation. Be strong,
be safe, be prepared, and you will come
out on top."

This adept insightful and well-placed contact
implies the survival path involves exiting
debt and investing in gold & silver,
even platinum. He has consistently advocated
this path for the full three years of our
contact. His Disney comment is a usual barb,
of being more a carefully crafted movie
production than a subset of reality. My
rejoinder is to prepare for shocking events
as the United States and the monarchy in England that spawned a feisty but tethered colony
both enter the Third
World. Nasty events will occur much like
tumbling down, or being tossed down, the
staircase into the dark cellar. England
never lost control of the United
States, but rather
maintained it via the US central bank and JPMorgan, the giant bank.
The US
has been either tied at the hip, or controlled
by puppet strings, by the older UK bankers more experienced
in brinksmanship. The nations will share
the same fate.

◄$$$ AFGHAN BALES OF CASH ARE LEAVING
THE NATION. THE STORY MAKES AN ABSOLUTELY
MOCKERY OF THE WAR. THE STORY RECEIVES NO
FOLLOW THROUGH ON COVERAGE IN THE UNITED
STATES, BESIDES THE ORIGINAL BREAKING NEWS.
ACTIONS BY AFGHANY LEADERS ARE NOT CENTRAL
TO THE OBJECTIVE OF THE WAR, NAMELY NARCOTICS.
THE ENTIRE THEATER IS OUT OF CONTROL. THE
INTRIGUING RESPONSE WILL COME FROM THE USCONGRESS
THAT FUNDS THE TRAVESTY. THEY ARE OUTRAGED,
BUT WATCH HOW HELPLESS THEY ARE. IT IS NOT
THEIR WAR. THEY ONLY PAY THE COSTS. $$$

The Wall Street Journal broke the story,
and the Der Spiegel filled in more details
about the corrupt Afghan leaders. Massive
amounts of cash are leaving the capital
of Kabul, much heading
for Dubai in the Persian Gulf. In the summer of 2009,
the international security company Global
Strategies Group assumed duties for providing
security at Kabul's airport. Its submitted reports on money transfers were sent
to the Afghan domestic intelligence service
until September, after which time senior
local officials no longer desired them.
One key question in my mind is whether the
cash is counterfeit, from the handy CIA
templates stolen straight from the USDept
Treasury. Maybe not, maybe just crisp uncirculated
bills from CIA 'Walking Around Money' useful
in greasing the palms of Afghan government
officials. This story is so ugly. It is
worse than any Fannie Mae fraud story, or
Wall Street extortion of TARP Funds, except
the amounts are much smaller from bales
of cash than electronic entries of hundreds
of $billions known to WashingtonDC. One
can conclude that the USGovt exported freedom
to the tiny war-torn country located strategically
between Pakistan and Iran. Its leaders sold out their country every
bit as much as the US leaders sold out theirs. The Afghan leaders
in charge have decided to leave town with
a lot of money, probably bribery money or
shared narcotics profits. USGovt money management
is worse than a crime syndicate, since it
laces in corruption with poor cost control.
If truth be told, vast sums, much greater
sums of money have left the United States to foreign accounts
by USGovt and Wall Street officials via
wire transfers. An eerie parallel is in
occurrence.

USGovt politicians have temporarily cut
off aid to the Afghan government. That is
a start, but let's see if any follow through
occurs. The corruption in Afghanistan is unspeakable.
Heck, it matches that of the United States, except the smaller nation cannot
conceal it so effectively. The money is
being siphoned as formerly secretive shipments
out of Kabul to the
United
Arab Emirates by well-connected
Afghans. Word has it that they are buying
luxury villas in Dubai, but surely the Persian
Gulf banks will swell a bit. Some USCongressional
members expressed outrage, when they should
be flogged for ignorance, blindness, and
gullibility for over eight years since the
Great Narcotics Monopoly War was launched.
Anger hides their shame.

Brigadier General Mohammed Asif Jabarkhel
operates the security checkpoint with airport
customs inspections at Kabul
Intl Airport.
All of his many attempts to stop this cash
flight have failed, despite the efforts.
He admits honestly, "Of course I
know what is going on here. But in this
country, who is allowed to speak the truth?
The central bank has reached an agreement
with the government that makes these kinds
of transfers supposedly legal. And whenever
we try to look into where the money is coming
from, pressure comes from the very top.
A couple phone calls are made, and the person
[loaded with cash] can carry on."
Well, the same goes for the US,
where truthers are mocked, whistle blowers
are fired, organized groups are attacked
as unpatriotic, and troublesome insider
bank officials are suicided. Jabarkhel has
been helpless to halt the huge amounts of
money regularly being secreted out of Afghanistan
by plane in boxes and suitcases. The cash
smuggling has taken place during the last
three years, a strong signal that either
Afghan leaders believe the war with the
Taliban is a useless endeavor or these same
leaders would rather live the good life
with beach views, martinis, an entertainment
budget, and a better diet, like a glimpse
of the other side from planet earth. According
to some estimates, at least $3 billion (=2.4
billion Euros) in cash has been airlifted
from the country. Bank wire transfers are
not a common option used. The identified
destination for these funds has been reported
to be Dubai. No justification for the volume makes any sense except siphoned
US
war funds, given the tiny Afghan GDP of
$13.5 billion. Sometimes American observers
who have been wise to the corruption in
both nations all this time simply respond
with "I told you so" or
react with more dismay or hope for termination
of funds or perhaps basic disgust of a broken
nation, ours.

Since the war began in 2001, complete with
false blame that the Taliban were accomplices
in the World Trade Tower attacks, the United
States alone has invested
almost $300 billion in military and reconstruction.
Minimal progress has occurred, as a significant
portion of the million$ meant for reconstructive
efforts were siphoned off, just like in
Iraq. Those who benefit
from the USGovt funds are clearly the Afghan
leaders, their families, their friends,
their bankers, and anyone else useful in
continuing the game. Names are not important.
Come one, come all. To find an honest Afghan
leader might be as diffucult as finding
a virgin in a Turkish brothel, or an honest
investment banker on Wall Street. The estimated
$3 billion in exiting funds is probably
a gross under-estimate. Important politicians
and business executives can take advantage
of the airport's special VIP area without
being searched before boarding. Any suspected
improper baggage loaded to the gills with
cash caught by customs officials usually
suffers only a mild delay, enough for timely
action by a connected official, like a quick
visit, a phone call, or a bribe. The fortunes
gained often have come to people related
to members of the government, who have access
to the those in charge, those dealing with
the USMilitary and the US contractors. They typically use the hawala
method of transaction, an Islamic tradition
for transfers based on honor and faith,
not receipts and invoices. Tracing the money
is impossible. The parallel again is painfully
evident with the US
narcotics smuggling, done by CIA incoming
flights that do not require customs checks,
and often by numerous defense contractors
using the same bypass procedures, in both
the United
States sites and NATO
airbases.

US politicians have responded, at least a reasonable
initial action. A panel approved a freeze
on the $3.9 billion in aid for the Afghan
Govt within the 2011 USGovt budget. Nita
Lowey serves as chair of the foreign aid
appropriations subcommittee to the US House
of Representatives. She said angrily, "I
do not intend to appropriate one more dime
for assistance to Afghanistan
until I have confidence that US
taxpayer money is not being abused to line
the pockets of corrupt Afghan government
officials, drug lords and terrorists."
Expect her to receive assurances from the
Pentagon soon, with additional calls from
the CIA and National Security Council. If
that fails to thaw the freeze, Lowey should
expect to lose her post, lose her Congressional
seat, or lose her life. Maybe she will be
caught red handed with child pornography
on her work computer, or resign suddenl,
or be the subject of a smear campaign during
the re-election process. Others in the way
of progress, like the CFO of Freddie Mac,
have decided to accept assistance in suicide.
With $350 to $370 billion in annual profits
from the Afghan narcotics sources, far too
much profit will be abandoned without telltale
syndicate responses, a combination of violence
and subtle pressure. See the Spiegel article
(CLICK HERE)
and the Wall Street Journal article (CLICK
HERE).

GULF
STRONGARM LEGAL TACTICS

◄$$$ THE VENERABLE US
SENATE HAS ATTEMPTED TO SHIELD THE CORPORATION
FROM LIABILITY RISK. AS USUAL, THE USCONGRESS
IS BEHOLDEN TO CORPORATIONS, NOT THE CITIZENS.
$$$

As a preface to the coverage of the BP
oil volcano and the consequent destruction
of the Gulf of Mexico
from toxic agents of myriad sources, consider
the actions of the USCongress. Before the
July Fourth weekend, an unreported maneuver
in the US Senate took place, designed to
protect British Petroleum and the USGovt
from liability in the Gulf disaster. It
apparently did not succeed. See the gutsy
feisty BrassCheckTV video (CLICK HERE).

◄$$$ HARMED GULF WORKERS CAN HAVE
BENEFITS SLASHED IF THEY REFUSE TO WORK
FOR BRITISH PETROLEUM. SIGN UP OR SUFFER!!
B.P. FOUND A FEDERAL LOOPHOLE FOR DEVIOUS
USAGE. $$$

Whistleblower news reveals that relief
payments from affected workers to the Gulf
oil clean-up project are to be be slashed
if the fishermen refuse to work for BP.
The same applies to other professions with
wrecked businesses. It is all very legal.
The giant oil firm, the great offender,
BP will deduct money from individual payments
on claims for lost income if the claimant
refuses to work in assisting the spill response.
Gulf resident Kindra Arnesen has converted
to whistleblower and full-time activist.
Reading from a letter received from BP,
she quoted the company's line which wrote
"BP will continue its efforts to
pay legitimate claims for losses incurred
due to the Deepwater Horizon incident. However,
federal law clearly provides for adjustments
for all income resulting from the incident,
all income from alternative employment or
businesses undertaken [...] and potential
income from alternative employment or businesses
not undertaken but reasonably available."
BP actually reduces claims by income taken
from non-BP sources, even is small, a devious
ploy. In other words, if you are a fisherman
who was put out of work by BP and you do
not elect to work in their employ, but you
still file a claim for losses over the Deepwater
Horizon disaster, that claim could be significantly
less than the actual damages incurred. All
because a different minimal job was taken
instead. See the Raw Story article (CLICK
HERE).

Grotesque distortions and deceptions are
being committed by British Petroleum. The
Truth in Gold website has a running commentary
on details of value. One person made the
following statement. He said, "As
for the Gulf oil situation. I was chatting
with a friend who is originally from New Orleans today, and she said that her people down there are saying
that everything being reported about the
BP effort is complete BullShxx. She
said that no claims are being paid, and
BP seems to be going to minimal effort and
expense to work on cleaning the mess. She
said they told her not to believe anything
being reported in the media about BP's efforts,
that it is a total media whitewash. She
was recently in Pensacola Florida and said the beaches are getting
decimated with oil, and that the oil is
now hitting the beaches further east of
Pensacola."
It would seem reasonable that putting
out a steady stream of television public
relations advertisements would be illegal,
some sort of misrepresentation, fiduciary
failure, or financial fraud case. See the
Truth in Gold website (CLICK HERE).

◄$$$ BRITISH PETROLEUM SECURITY IS
DIRECTED AGAINST PHOTOGRAPHERS, WHICH CARRIES
A $40K FINE AND/OR JAIL TIME. THE FIRST
AMENDMENT HAS BEEN OVERRIDED FOR PUBLIC
SAFETY REASONS. MINIMUM DISTANCES MUST BE
MAINTAINED, AND ACTUAL TAKING OF PHOTOS
HAS BEEN DECLARED ILLEGAL BY EXECUTIVE DECREE.
REACTION HAS BEEN TAME SO FAR, EXCEPT FOR
C.N.N. REPORTER ANDERSON
COOPER. $$$

The World Socialist Website has revealed
a shocking development. The First Amendment
has been apparently altered by some executive
decree. Journalists who willfully defy
the White House order to stay clear of the
oil blob, spill, slick, and marshes, beaches,
and coastline could be prosecuted as Class
D felons and face up to five years in prison
and a $40,000 fine. Refer to the recently
instituted Beyond First Amendment, where
freedom of the press now carries a heavy
fine and/or incarceration. The transparent
motive for the decree alleges and professes
to protect the safety of clean-up workers,
when in reality it is intended to prevent
the population from viewing the devastation
caused by the BP oil blowout and being properly
warned about health risks. The White House
is worried that clean-up workers might reveal
something about the dangerous conditions
under which they work and the real scale
of the environmental devastation. True to
syndicate tactics, British Petroleum has
imposed a gag order, but with unclear authority.
Perhaps hundreds, maybe even thousands of
workers have become sick from exposure to
oil and toxic dispersants. They surely,
not possibly, will face a lifetime of chronic
ailments. Independent Claims Facility
administrator Kenneth Feinberg has declared
that BP's $20 billion dollar settlement
fund will be off limits to the large segments
of the public, such as businesses in the
tourism industry, fishermen who operate
on a cash basis, and Gulf coast homeowners
whose property values will plunge. The
company propaganda is just that, intended
to shape public opinion and distort reality.

MSNBC reported a case of arrest threats
to a photographer standing on public property.
Consider it a casualty to the news blackout
decree, administered under the cloak of
safety. A photographer taking pictures of
a BP refinery in Texas was detained by a BP security official, by
local police, and by a man from the USDept
Homeland Security. The story was originally
cited by ProPublica, a non-profit US news organization.
The photographer, Lance Rosenfield, said
he was stopped after arriving in Texas
City to work on a story in collaboration
between Public Broadcast System (PBS) and
ProPublica. Rosenfield was released after
officials looked through the pictures he
had taken and took down his date of birth,
Social Security number, and other personal
information. The information was turned
over to the BP security guard who claimed
standard procedure. Rosenfield, a Texas-based
freelance photographer, said he was followed
by a BP employee after taking a picture
on a public road near the refinery, and
then cornered by two police cars at a gas
station. The officials told Rosenfield they
had the right to look at the pictures taken
near the refinery and if he did not comply
he would be taken in (threat of arrest).
See the World Socialist Website article
(CLICK HERE). The
person who took this photo is subject to
arrest and fines. All these workers will
likely be dead before year 2020, maybe much
sooner!!

The Pensacola Daily Reveille offered a
glimpse of the economic damage. Fewer people
have been willing to spend their summers
at the beach. Cancellations have come in
waves, with similar damage as the waves
of ocean water mixed with toxic agents.
One hundred cancellations were made in the
city in the second week of the spill, according
to a local hotelier. Schroeder reported
that on June 10th, the day the first tar
balls hit the beaches, another 1000 cancellations
struck. The telephones have stayed ominously
silent as new reservations have dried up.
He said, "It is pretty safe to say
about 75% of our reservations that have
been on the books are gone. Some condos
and hotels are 100 percent cancelled."
Here is where the blackout decree comes
in. The newspaper wrote, "Yet it
is becoming increasingly impossible to actually
witness this, since as we reported, there
is now a legally imposted distance barrier
of 65 feet between any reporter and locations
with oil booms, which are rapidly becoming
virtually all. And not 24 hours after first
reporting on this, did some reporter already
find just how serious the administration
is in withholding this brand new rule."

So British Petroleum and the Obama Admin
have replaced the First Amendment, or re-written
it, altering it for modern day application
in a fascist state. They have imposed a
$40,000 fine and Class D felony for violations.
From CNN, Anderson Cooper decided to shine
a bright light on the situation, if not
the oil blobs. He reported from New
Orleans, "The Coast Guard today
announced new rules keeping photographers,
reporters, and anyone else from coming within
65 feet of any response vessel or booms,
out on the water or on beaches. In order
to get closer, you need to get direct permission
from the Coast Guard captain of the Port of New Orleans. Shots of oil on beaches
with booms... stay 65 feet away. Pictures
of oil soaked booms uselessly laying in
the water because they have not been collected
like they should. You cannot get close enough
to see that. And believe me, that is out
there. But you only know that if you get
close to it, and now you cannot without
permission. Violators could face a fine
of $40,000 and class D felony charges. The
Coast Guard tried to make the exclusion
zone 300 feet before s caling it down to
65 feet.... We [the press] are not the
enemy here, those of us down here trying
to accurately show what is happening down
here, we are not the enemy. If we cannot
show what is happening, warts and all, no
one will see what is happening, and that
makes it very easy to hide failure and hide
incompetence." Cooper does not
mention the necessary warning about health
risks to the people, even to the clean-up
workers. See the Zero Hedge article (CLICK
HERE).

Cooper needs to wake up. The people are
the enemy to the ruling elite, whose bankers
are the visible part of the syndicate. The
press working in public interest are even
greater enemies. The Jackass long ago saw
a national deterioration, an economic death
experience, an inevitable march to the Third
World, complete with the attendant chaos,
coming way back in January 2007, and got
the hell out. The sequence of events is
not very surprising. What people are
witnessing is a combination of national
breakdown toward systemic failure, wreckage
caused by corruption & mismanagement,
gutting the system by certain leaders, some
crossfire between global adversaries, and
possibly some examples of parasites killing
the host. The intense light of the press
will not be held back. Enter zoom lenses,
hidden cameras, and anonymous reporting,
even YouTube exposures, which the USGovt
and BP will not be able to stop. The Jackass
is not advocating it, only expecting it.

GULF
OIL RIG MECHANICS

◄$$$ BP PLEDGES TO STOP THE OIL VOLCANO
BY END JULY, BUT THE DAMAGE IS PROFOUND
TO THE DEEPLY BURIED CASING STRUCTURE. BESIDES,
THE LEAKS ARE COUNTLESS IN A 5 TO 10 MILE
RADIUS ALL ALONG THE SEABED FLOOR. THAT
IS EVIDENCE OF THE BROKEN CASING ITSELF,
DEEP IN THE EARTH CRUST. $$$

Embattled British energy giant BP has promised
loosely to stop the leaking Gulf oil well
by July 27th, ahead of its earlier target
of mid-August. That is the due date to report
Q2 earnings, complete with interviews granted
to investors. They live in a fantasy land.
The head of BP Gulf Coast restoration unit
Bob Dudley told the Wall Street Journal,
"In a perfect world with no interruptions,
it is possible to be ready to stop the well
between July 20 and July 27." He
hedged with mention of the approaching hurricane
season, giving himself an excuse. The WSJournal
said BP was laying a series of backup plans
in case its current operations go awry.
It gets worse. Citing company and Obama
Admin officials, the journal reported on
a BP plan to connect the rogue well to existing
pipelines in two nearby underwater oil &
gas fields. In my non-expert view, that
wouuld put the neighboring pipelines at
risk of breakdown as well, as a major expansion
of the leak. The enormous pressures on the
broken pipes must be contained before any
possible connections can be securely made.
That is not engineering, but common sense.
Think about a broken street fire hydrant
being connected to neighborhood pipelines.
Any connection of a pipeline out of control
to another would quickly apply stress to
the other pipeline. See the UK Telegraph
article (CLICK HERE)

◄$$$ THE INTERIOR STRUCTURE OF THE
SUBMERGED OIL WELL CASING HAS BEEN DESTROYED.
IT DID NOT JUST CRACK. IT EXPLODED AND SHATTERED
THE ENTIRE UPWARD STRUCTURE FROM DEEP UNDER
THE SEABED FLOOR IN THE EARTH CRUST. $$$

The USDept Energy has confirmed that segments
of the BP Deepwater Horizon oil well casing
were violently ejected upwards into the
Blowout Preventer. The explosion originated
from deep within the structure, like over
a mile beneath the seafloor, as a methane
bubble rose and was ignited. Hence, experts
acknowledge what the public has not been
told. The entire leaking structure cannot
be capped, cannot be stopped from leaking,
since the damage is enormous and deep down.
The casing is a thick metal tube, subjected
to great pressure. When broken beneath the
seafloor, the leak disseminates in all directions
at many different depths, and under great
pressure. It is, plainly stated, far out
of control and not repairable. Imagine a
fire hose spewing water all around, with
people trying to grip the nozzle, attempting
to contain the water, but the entire length
of the thick hose has numerous torn parts
in it. Oil industry expert Matt Simmons
has warned for several weeks that the well
casing was destroyed by the initial explosion
at the Deepwater Horizon rig. Few wished
to listen, as BP deceived with press announcement
after press announcement of a stupid Top
Hat followed by a series of cockamamey plans,
all of which accomplished zippo, zero, nothing,
nada. Simmons has been ridiculed, since
evidence of broken well casing had not been
spotted on the seafloor. At the same time,
the industry has been complaining about
extreme challenges at such great depth,
where it is dark, pressure is huge, and
maneuverability is near nil. The USDept
Energy has endorsed the view of Simmons
about a destroyed well casing structure,
thus championing his view. Exonerate
is a strong word, since not charged with
anything but frigthening people. In today's
world in the United States, telling the
truth about bad situations earns attacks
and ridicule.

Here are some details reported by the Los
Angeles Times, with comments interjected.
The Energy Dept, using gamma ray imaging
equipment and other sophisticated tools,
detected not one but two drill pipes, side
by side, inside the wreckage of the broken
Blowout Preventer stuck on the bottom of
the Gulf of Mexico.
BP officials said it was impossible, but
they are both corrupt and morons, the most
criminally involved and most incompetent
in the industry, with an established track
record. BP used a single pipe in the drill
site, which is unwise given the depths and
pressures (both water pressure and energy
deposit pressure). The Deepwater Horizon
rig bored 13,000 feet below the ocean floor,
with pipe segments attached end to end.
When the wreckage was cut to install a containment
cap this month, they found two pipes. The
discovery implies immediately that the force
of the explosion from the depths below,
based upon methane, contained such energy
with such violence on April 20th that it
sent pipe segments hurtling into the blowout
preventer, like derailing freight cars twisting
the locomotive. Energy Secretary Steven
Chu is working overtime to determine what
exactly happened, so that capping efforts
can be more effectively carried out. The
BP clowns and USGovt sponsors are groping
in the dark, as the massive leak continues.

A BP insider has sent a message through
the internet to the public, which contains
some honest assessment, or more graphic
depiction of the disaster. The anonymous
person wrote, "BP has opened up
Pandora's Box on the seafloor one mile deep.
It has no chance whatsoever of containing
the situation and bringing this disaster
(of their making) under control. The
well pressure at MC252 is in the region
of 30,000 psi (pounds per square inch) and
the oil industry does not have the knowhow
and technology to deal with blowouts under
this pressure 20,000 feet below the seabed.
This oil and gas will leak for months
and possibly years. There are hundreds
of millions of barrels of oil and enormous
quantities of methane in this field. BP
Plc is finished. They have no political
friends in Washington
and their cash pockets are not deep enough
for the bills they will have to pay. This
is especially true for the clean-up costs
after a hurricane covers the whole area
with oil and poison rain. This is only a
matter of time before we see this happen."
The latest BP development is the supposedly
successful placement this week of a truly
gigantic cap over the well head leak. They
are attempting to stop the leak and recover
the oil. However, given the condition of
the explosion site, the area probably has
100 to 500 spots where leaks are seeping
through and exiting the seafloor in a 5
to 10 mile radius. My belief is that BP
efforts are futile and a waste of time and
hope. Later on, BP will likely try to lay
blame on other oil rigs, not theirs.

GULF
OF MEXICO ECOSYSTEM RUIN

◄$$$ PORTIONS OF THE GREAT OIL GLOB
HAVE BEEN SPOTTED OFF THE NORTH CAROLINA COAST ON THE ATLANTIC SIDE.
WITNESS THE GREATEST CONTAMINATION CASE
AND COLLUSION TO COVER UP IN NATIONAL HISTORY.
$$$

ROFFS Oil Tracking shows the BP Gulf combination
oil blob, oily pools, and oil slick traveling
up the entire east coast of Florida.
Be careful though, since it caught photographing
it, you might be arrested. Alexander Higgins
runs an intrepid weblog. He wrote, "I
recently wrote that oil from the BP Gulf
Oil Spill may be as far north as North Carolina, based on satellite data and reports of oil off the Florida
keys reported June 9th by a University of South Florida professor. The
Federal Government however appears to be
complacent with continuing to hide the location
of the spill from the public. The misleading
of the public about the safety of public
beaches and the location of the oil is even
causing an uproar by local Florida
residents." Failure to warn the
public exposes them to nasty health risks
without preparation. See the Alexander Higgins
weblog article (CLICK HERE).

◄$$$ ALMOST ALL EXXON VALDEZ CREW
MEMBERS IN CHARGE OF CLEAN-UP ON ALASKAN
SHORES FROM 1989 ARE DEAD. ALMOST ALL EXXON
VALDEZ CLEAN-UP WORKERS DIED IN THE FOLLOWING FEW YEARS AFTER DOING
THE DIRTY WORK, FROM HEAVY EXPOSURE TO TOXICITY.
B.P. CLEAN-UP WORKERS ALREADY ARE MADE VERY
SICK. SOME WILL DIE SOON. $$$

Last month in the interest of balance,
a positive element was reported in the Crisis
Coverage Report. The Corexit short 28-day
half life might not be much consolation,
since they are still spraying it into the
Gulf, thus replenishing it rapidly. The
methane and other poisonous gases might
be the worse threat. The Exxon Valdez oil
wreck on the Alaskan shores occurred in
March 1989. Its story is long, twisted,
devious, ugly, complete with murder, reversed
court awards, ruined businesses, and ruined
lives. Be sure that the workers probably
signed waivers to eliminate compensation
from the risk accepted. Many scientists
have warned of the many health dangers from
this oil spill, even without a toxic dispersant
added to the mix. CNN has dutifully reported
that the vast majority of those who worked
to clean up the Exxon Valdez oil spill in
Alaska are now dead. To repeat, almost all of them are dead. More
details, an expert on CNN cited that the
life expectancy for those who worked to
clean up the Exxon Valdez oil spill is only
about 51 years. Considering the fact that
the oil spill in the Gulf of Mexico is 30 times more extensive than the Exxon Valdez disaster,
the clean-up crew will surely suffer perhaps
thousands of deaths. Workers made sick are
being replaced by new workers. The linked
article shows an absolutely stunning news
clip from CNN. Beware of any participation.
This is why evacuation plans might be the
next course before the general public is
affected, apart from the clean-up crews.

The facts are horrible. The Gulf
of Mexico has turned into a Toxic Soup of
crude oil, methane, benzene, hydrogen sulfide,
other toxic gases, and poisonous chemical
dispersants such as Corexit 9500. To be
sure, some health damage has been seen already,
but the reality is that the true health
toll of this oil spill will not be known
for decades. See the Business Insider article
(CLICK HERE)
and the YouTube video (CLICK HERE). Some news items reported:

Already, a large number of workers cleaning
up the BP oil disaster in the Gulf
of Mexico report that they are suffering
from flu-like symptoms.

According to another new report, exposure
to the oil disaster in the Gulf of Mexico
has resulted in 162 cases of illnesses
reported to the Louisiana state health department.

In addition, according to one local
Pensacola news source,
"Some 400 people have sought medical
care for upper or lower respiratory problems,
headaches, nausea, and eye irritation
after trips to Escambia
County beaches."

◄$$$ BP OIL VOLCANO SPILL CONTAINS
TOXIC AGENTS FOUND IN THE ECOSYSTEM ALREADY.
THE MAIN CULPRIT IS PROPYLENE GLYCOL (SIMILAR
TO CAR ANTI-FREEZE). MARINE LIFE WILL VANISH
SOON FROM AN ASSORTMENT OF POISON AND TOXIC
LEVELS OF GASES. $$$

A motivated citizen James C Fox has provides
a contribution on the toxic agents to the
Gulf of Mexico. In
his own words, "Oil and water samples
were taken from both the Shores of Grand
Isle and from 20 miles out [from the Louisiana coast]. The preliminary analysis was done at an academic
analytical chemistry laboratory. Looking
for the likely pollutants from the deep
water Horizon Oil spill. It was focused
on the detection of benzene and propylene
glycol. Benzene and other highly toxic
contaminants were very low. However, the
concentration of propylene glycol
was between 360 and 440 parts per million.
Just 25 parts per million is know to kill
most fish and propylene glycol is just one
of many ingredients found in Corexit. In
short, the Gulf is being poisoned by BP's
usage of the dispersants even after the
EPA asked them to stop back in May. We are
willing to provide ANY respected known laboratory
these samples or provide them with more.
This is very serious to all people and marine
life in and around the Gulf." The
account here does not even mention the toxic
threat to marine life from methane, which
the Crisis Coverage Report mentioned last
month. Cox should be careful, since he might
risk arrest and stiff fines for his efforts.
See the Zero Hedge article (CLICK HERE).

◄$$$ COREXIT IS A VERY NASTY CHEMICAL
INTRODUCED BROADLY INTO THE GULF COAST ECOSYSTEM
WITH FULL KNOWLEDGE OF ITS TOXIC POTENTIAL,
WITH CLEAR INTENTION, EVEN AGAINST USGOVT
URGING. THE CHEMICAL HAS INCREDIBLY HARMFUL
EFFECTS TO THE HUMAN BODY. $$$

Toxicologists have pitched in to provide
details on the effects of Corexit to the
human body, or any other creature with cellular
structures for that matter. Corexit not
only disperses the oil in water, it disperses
and penetrates the entire human body thoroughly.
It causes a rupture of red blood cells,
and causes internal bleeding. It even goes
so far as to allow crude oil to penetrate
into the cells and every internal organ.
Two toxicologists have come forward to claim
that Corexit is much more harmful to human
health and marine life than we have been
told. Gulf toxicologist Dr Susan Shaw, Founder
and Director of the Marine Environmental
Research Institute, examined the chemicals
present. Reporting to CNN, she talked about
shrimpers throwing their nets into water.
Water is then splashed onto the fishermen's
skin. One man experienced a headache that
lasted three weeks, complete with heart
palpitations, muscle spasms, and bleeding
from the rectum. She explained how Corexit
ruptures red blood cells, causes internal
bleeding, and results in liver and kidney
damage. She said, "Corexit is very
toxic and goes right through skin. The reason
this is so toxic is that these solvents
[from dispersant] that penetrate the skin
of anything that is going through the dispersed
oil takes the oil into the cells, takes
the oil into the organs& This stuff is toxic
to every organ system in the body."

In a similar message, marine biologist
and toxicologist Dr Chris Pincetich, who
has an extensive background in testing the
affects of chemicals on fish, says that
Corexit disrupts cell membranes. He accuses
the EPA toxicity testing for Corexit to
be woefully inadequate, since EPA testing
for mortality usually only requires a 96-hour
time frame. His doctoral research found
that fish that were alive at 96 hours after
exposure to pesticide were dead at the two
week mark, yet the EPA concluded the chemicals
were considered non-lethal for the purposes
of the test. Shaw and Pincetich are wildlife
conservationists. The industry scientists
working for Exxon and the manufacturer of
Corexit itself admit that the stuff is toxic.
They had better be careful for possible
arrest and stiff fines, the reward for their
warnings and work. See the Washington Blog
article (CLICK HERE).

## GULF
DISASTER SPECULATION

◄$$$ MANY OUTRAGEOUS THEORIES HAVE
BEEN FLOATED, WITH MUCH SUSPICION, GUESSWORK,
AND RAISED THEORIES. SIMPLY CONSIDER A NUMBER
OF THEORIES. SOME WILD THEORIES MIGHT HAVE
SOME REALITY AND SUBSTANCE BEHIND THEM.
A COMPLICATED STORY MIGHT SOMEDAY BE TOLD,
DEPENDING UPON THE DIRECTION OF THE NATION.
IT MIGHT BE HARD TO BELIEVE THE EXPLOSION
AND CONTAMINATION IS NOT CONNECTED TO OTHER
GLOBAL EVENTS AND FACTORS. $$$

As preface, my personal view is not
important, and besides, my opinions
and suspicions will not be elaborated upon
on this extremely dangerous topic. The entire
story is a tragedy, and it contains much
hidden intrigue, for sure. Maybe my views
are biased, having been threatened twice,
once by USGovt security agency and another
by a European banker. My list of taboo high
risk topics grows. Here are several theories,
almost all of which place the United States
Southern Gulf Coast as victim or squarely
within the crossfire. All will be couched
as possible explanations, with no evidence
offered. Just thinking out loud, so to speak.
Readers are free to do research, discuss
with friends, and think for themselves.

A) A few months ago, the release by Great Britain of the Lockerbie bomber enraged
many people. The prisoner was from Libya, convicted of the crime that killed all
243 passengers and 16 crew members. Since
that time, British Petroleum signed a significant
contract with Libyan leader Qaddafi for
extensive off-shore oil drilling from the
Libyan coast. The entire sequence sparked
anger, perhaps enough to cause a response
against BP. Qaddafi has many enemies.

B) British Petroleum is a major oil product
supplier to Iran, a nation with many enemies. Halliburton
was known to be on the Deepwater Horizon
oil rig platform hours before its explosion,
even with men not looking like oil roughneck
workers. Halliburton has been charged with
countless criminal violations in Iraq, seemingly a willing
partner in crime if the incentive is present.
Afterwards, Iranian supplies of gasoline
and diesel have turned acutely low, a development
more effective than sanctions.

C) With all the downward price pressures
on assets and commodities, Big Oil interests
had a motive to attempt to prevent the crude
oil from heading much lower. The oil price
descended from a $140 per barrel down to
$35 after the Wall Street death experience
in late 2008 and early 2009. If the entire
Gulf of Mexico oil drilling is halted, and all output halted, then support
for the crude oil price comes. All Gulf
of Mexico oil rigs are currently shut down,
even those compliant with safety regulations.
The oil price has been closer to $80 per
barrel in recent weeks than to $70. Oil
company profits are out of danger.

D) In last month's Hat Trick Letter report,
the theory was explained on exploitation
of a crisis to bring about political change.
The Obama Admin is determined to win passage
of the lunatic Cap & Trade legislation
that taxes carbon emissions and requires
costly home inspection stickers. Whether
advocates caused the oil rig explosion or
simply exploit the situation as effect in
its wake, that is unknown.

E) With contamination of beaches, shorelines,
and marshes, business is shattered and workers
are idle. The negativity public sentiment
is thick from the general public against
BP specifically, and maybe against oil companies
generally. Timing is ripe to make a national
turn of direction away from petroleum, an
American mainstay prevalent and strong for
50 years. The entire sentiment can be turned
to provide a catapult for renewal energy
initiatives, its acceptance, and funding.
Check the largest investors in green technology.

F) The USDept Interior licensing process
is extraordinarily careless. The Bush-Cheney
team loosened requirements for off-shore
drilling in the Gulf of Mexico. Many projects and processes were fast tracked. Safety
regulations and satisfaction of them were
routinely run roughshod, ignoring the process.
In fact, several licenses have been granted
by the same inept team at Interior, even
after the explosion and massive leak from
the Deepwater Horizon rig.

G) The rivalry between US oil firms and
the British national oil firm has been growing.
An unclear agenda by US
oil firms could be to wreck the British
oil firm. They could conceivably seize the
BP Americas assets, shift the liability
to the broken USGovt debt structure, and
declare victory. The steps would be complicated,
but Wall Street firms might offer their
expertise, for a fee. Some US oil service firms are at the heart of the syndicate
with deep criminal motives. Relations between
the two nations have been strained ever
since the Wall Street death experience,
coupled with a London bank death experience.
The usual cooperation is no longer evident.
The UKGovt has a new ruling coalition, after
the reluctant Bush Ally departed, namely
Gordon Brown. The loyalty of David Cameron
might be very unclear, even adversarial.
Tony Blair was much more a Bush Ally, a
partner in numerous shady enterprises.

H) The HAARP weapons have come into the
alternative news sources with a notable
splash. They are blamed by some for causing
certain earthquakes, maybe even the greater
earthquake and tsunami that struck Indonesia
and Thailand
in 2005. The HAARP telltale signal is an
earthquake 5 to 10 kilometers below the
earth's surface. The earthquake in Haiti
aroused more suspicions, since the Caribbean
is not a zone with tremor history. Some
acquaintances met a group of Saudis last
week, who contend that the formed oil volcano
was caused by the USMilitary, and BP is
more a fall guy than a perpetrator. The
Deepwater Horizon rig site is loaded with
fields of discarded antiquated weapons.

People should not expect justice to prevail.
Whether accidental from negligence, or the
site of a planned explosion, we will probably
never know. The important objective is to
stop the massive leak. A better objective
would be to remove BP from any responsible
position to repair the Blowout Preventer
or clean up the gulf, even the beaches.
They are incompetent. The goal should be
to halt the process underway, which appears
to be toward extermination of the Southern
Shores. BP Americas will never survive.
Its assets will surely be seized. The next
bond offering will expose a mortal wound,
and make clear its death. Besides, the seized
assets will not come close to covering the
clean-up costs, the lawsuits, and fines.
Courts will be full of BP claims for a decade,
maybe longer.

Perhaps diabolical sinister forces conspired
to wreck the Gulf of
Mexico in order to cripple the USEconomy.
A combination of negligence, criminal behavior,
market profit potential, and powerful enemies
make for a deadly mix. The perpetrators
might be inside the US leadership and corporate
leadership, the very real Fascist Business
Model at work. Their goal might be martial
law, as second stage to 911 in a grand plan.
Evacuation of the Gulf
Coast could be the initial exercise of the martial law advocates. The
United
States has been the
host for a few key parasites whose names
are best not mentioned. The primary frauds
and gutting of the national finances are
nearly finished, like the Wall Street bond
fraud, the housing wreckage, and the Black
Holes officially adopted (Fannie Mae &
AIG). The usual course of action, the deep
pathogenesis, is for the parasite to kill
the host. Given the extreme lack of global
popularity of the USMilitary, some foreign
parties see a means to dislodge the military
from its powerful perch by snuffing out
the USEconomy. The USGovt is incapable of
prosecuting grand criminals near the helm.
Foreign forces might be at work. Lastly,
never to be overlooked, the Greenspan tenure
was all about ruin of the United States in my opinion.
He took two paychecks, one from Swiss bankers.

◄$$$ RELOCATION & EVACUATION
PLANS OF THE GULF COAST AND COASTAL FLORIDA
ARE IN PLACE, AGREED UPON. THE DESTINATIONS
MIGHT INCLUDE CANADA. LARGE SECTIONS OF THE GULF COAST WILL SOON
BECOME UNINHABITABLE. THE COASTAL ECONOMY
WILL DEGRADE INTO A WRECK ZONE. THE SUPPORT
SYSTEMS FOR FOOD & SUPPLIES ARE TO FACE
RUIN ALSO. RAIN WATER WILL CONTAMINATE MUCH
OF THE LAND ECOSYSTEMS, BUT THE NEXT HURRICANE
WILL ESCALATE THE DAMAGE. $$$

At least two different sources inform
about concrete plans to relocate a few million
people from the Gulf Coast states, maybe
over ten million people. One came from
a fellow with USMilitary experience and
connections. Another came from a Canadian
fellow with connections to their government,
who has a solid friend who attended one
of the USGovt meetings with Canadian officials.
At least these are contingency plans. Americans
living on the coasts along Louisiana, Mississippi, Alabama, and Florida might
soon find their environment uninhabitable
and their local economies a total wreck.
They will go north, some perhaps to Canada. The Atlantic coast has yet to report ecosystem
and economic destruction. That comes next,
but to a smaller degree of damage.

In some places, birds are falling dead
from the sky, marshland creatures are dying
in droves, and rain water has created yellow
spots on crops inland. Clean-up crew workers
are sick by the dozens. The toxic rain from
oil and dispersant is hitting the land.
The devastation process is proceeding. News
censorship cannot succeed, but will be attempted.
A hurricane is inevitable eventually. With
a hurricane or without one, the Gulf
Coast ecosystem
is under siege and at great risk of becoming
uninhabitable. At the same time, the hotels
and coastal workers are shut down. The Gulf Coast economy is under siege also, as
ghost towns should be expected to develop.

◄$$$ A NATIONAL TRAGEDY IS UNFOLDING.
THE DECISION TO USE COREXIT IN MY VIEW INDICATES
A MOTIVE TO KILL THE COASTAL ECOSYSTEM AND
ECONOMY WITH PREMEDITATION. $$$

In my view, the really important critical
clue was widespread usage of the Corexit
oil dispersant. Its usage proved they did
NOT want to collect the oil with skimmer
vessels effectively. Its usage proved they
wanted INSTEAD for the oil to remain below
the water surface, where it would kill marine
life. Its usage proved their goal was contamination
of the water system, both sea and airborne.
Their excuse was to prevent oil from hitting
the shore, which was certain to happen with
or without a dispersant. Toxic rain is already
falling on the coastal areas, killing the
ground level green life. The toxic rain
will render great harm to farm land and
crop output, much more to come. The food
supply from fish, crustaceans, and farm
crops will be contaminated. People will
die from eating such food. Rivers and tributaries
are soon to close for all vessels since
they contain oil on the hulls. Cities &
towns are soon to close down electricity
generators since water intakes contain oil.
Any hurricane activity will turn a nightmare
into a national tragedy. Much more to this
story, to be left for conjecture. As with
Watergate, follow the money, like stock
investments, shorting activity, and communications
before the Deepwater Horizon explosion.
Any serious investigation will find certain
Wall Street firms and certain Major Oil
Service firms in a position to exploit the
situation, BEFORE it occurred. Some
of my opinion will be kept private, not
shared. One thing is clear, that the Southern
coastline is taking on firm Third World
traits, and USGovt officials resemble Third
World leaders in their official negligent
response.

TAME
FINANCIAL REGULATION REFORM

◄$$$ FINREG DISAPPOINTS, LARGELY
RETAINING POWER TO THE BANKERS. NUMEROUS
AGENCIES AND COMMISSIONS ARE TO BE CREATED.
MOST WILL QUICKLY BECOME SUBSERVIENT TO
THE WALL STREET FIRMS AND THEIR DOMINANT SYNDICATE.
SOME POSITIVES COME FOR WATCHDOGS AND CONSUMER
ADVOCACY. A MORE CYNICAL VIEW WOULD CONCLUDE
THAT FINREG IS DEAD, AS IS ENTIRE REFORM
MOVEMENT. $$$

Overhaul of financial regulation has swept
the land. It is safe to say that the big
banks and the US Federal Reserve indeed dodged a series of bullets,
as compromises were struck, and surely backroom
haggling come with strong illicit pressures.
The new legislation to overhaul financial
regulation will help limit to some extent
risk-taking and improve capital buffers.
Lending will be curtailed, but it should
be, since so reckless in the past. Be sure
to know that the new regulations will
NOT fundamentally reshape Wall Street firms
or prevent another crisis. The fraud
kings are still in charge, and the lunatic
asset bubbles will continue to appear. The
bill did nothing to prevent 0% credit for
the system, where the elite have
the best access. This is the primary cause
for the asset bubbles & busts cycle.
The endless House and Senate conferences
completed compomises and diluted provisions
from the tougher preceding versions like
an earlier Senate Bill, limiting rather
than prohibiting the ability of federally
insured banks to trade derivatives and invest
in hedge funds or private equity funds.
The USFed will not be subjected to the
harsh light of monetary decision disclosures,
nor a steady stream of independent financial
audits. Limits will be placed on potentially
risky activities such as proprietary trading
and Over-The-Counter derivatives. Regulators
will carry new powers to seize and wind
down large, complex institutions if needed.
But the Liquidation Power can also be
used to eliminate Wall Street rivals,
and eliminate big firms that attempt to
reveal Wall Street criminal activity. Vast
abuse of this power has been created, something
to watch closely. The overhaul will do
nothing to reduce the size of banks deemed
Too Big To Fail. The overhaul will do nothing
to force disclosure of criminal bond fraud
with multiple players in collusion.
The outcome is far from satisfying, accomplishes
a few objectives, but gives the criminal
banking syndicate a reprieve.

Dean Baker from the Center for Economic
& Policy Research put it best. He said,
"[The legislation is] largely a
fig leaf. Given where we were when this
process was started, I would have to imagine
the Wall Street firms are pretty happy."
Benjamin Wallace is an analyst at Grimes
& Co in Massachusetts.
He said, "There is going to be some
adaptation, but I do not think there is
going to be any colossal impact. There is
going to be a capital raise, but the analysis
we have seen suggests we are talking in
the pennies in terms of dilution [per share
of big banks]." See the comprehensive
Business Week article (CLICK HERE).

My view is that the heavily revised Financial
Regulatory Bill is 75% of what was anticipated
on my end. Almost no power was removed from
the Wall Street firms. Almost no tight scrutiny
is given for USFed audits, although more
sunlight will come inside, a start of the
process. They did not touch Fannie Mae &
AIG, only made rules to avoid creating new
such monstrosities. The curve ball is limit
to fuzzy proprietary trading, which Wall
Street firms will manage to work around,
lie through, and coerce a blind eye. They
will rely upon offshore subsidiaries and
mislabeled client accounts. It is amazing
how the most important parts of the original
plan were excluded, in bringing justice
to major bond fraud by Wall Street firms
working closely with the USFed, even collusion
with credit agencies. This is a major victory
for Wall Street and the financial syndicate.

◄$$$ FINANCIAL REGULATORY OVERHAUL
HAS MANY PROVISIONS. ONE BY ONE, ITS CATEGORIES
ARE SUMMARIZED. IT IS A DECENT REVIEW, HARDLY
COMPLETE. $$$

VOLCKER RULE FUNCTIONAL SEPARATION

The so-called Volcker Rule was intended
to prohibit the big banks from proprietary
trading, but it was diluted and weakened
in the end. Practicality met basic bank
pressure in compromise. Some Wall Street
firms have stated feebly that such trading
cannot be separated from overall activity,
which is nonsense. Banks will be allowed
to invest in private equity and hedge funds.
Limits have been placed at 3% of any individual
target fund capital, and 3% of bank Tier
1 capital as investor. No return even remotely
will come to the Glass-Steagall Act that
separates banks, brokerage, and insurance.
Volcker was shot down and over-ruled. Even
his second volley was largely gutted.

OTC CREDIT DERIVATIVES

A regulatory structure for the $615 trillion
of Over The Counter credit derivatives market
has been established for the first time.
Banks must push a portion of their Swaps
trading into subsidiaries, in separation
from depositary institutions. That way,
access to the Federal Reserve discount lending
window is limited. Banks will be able to
maintain their trading operations so long
as they are used to hedge risk or trade
interest rate or foreign exchange swaps.
Federally insured banks will be given up
to two years to send Credit Default Swaps
yet to clear off to a separately capitalized
subsidiary. A gigantic bloat of CDSwaps
have yet to clear after over a year. Most
OTC derivatives will be sent through third
party clearinghouses onto regulated exchanges
or similar electronic systems, thus making
them easier for regulators to track. Regulators
also will be required to impose heightened
capital requirements on companies with large
swaps positions, and would be given the
authority to limit the number of contracts
a single trader can hold. Exceptions for
the Big Four Cartel price control artisans
are certain to be revealed in time, perhaps
for national security reasons. See JPMorgan
and Interest Rate Swaps that help manage
the USTreasury Bond complex.

CONSUMER BUREAU

A Consumer Bureau will be created, a consumer
financial protection outfit located at the
USFed to police banks and financial services
businesses for credit card and mortgage
lending abuses. It will have independent
authority though, led by a director appointed
by the President and confirmed by the Senate.
It will enforce those rules for banks and
credit unions with more than $10 billion
in assets. Credit card lenders might be
required to reduce interest rates and fees.
Mortgage lenders might be subject to stricter
disclosures to borrowers about loan terms.
Decisions by this bureau are subject to
override by the new Financial Stability
Oversight Council, should the panel identify
any threatened safety, soundness, or stability
of the US financial system.

CREDIT CARD MANAGEMENT

Credit cards and debit card fees would
be put under the USFed for oversight. Interchange
swipe fees paid by merchants would be limited.
Retailers will be permitted to refuse credit
cards for purchases under $10 and offer
discounts based on the form of payment.
New rules will be issued to permit merchants
to route debit card transactions on more
than one network, for increased competition.
Majors like VISA and MASTERCARD set interchange
rates and pass the money collected to card
issuers including big banks. Interchange
is the largest component of the fees US
merchants pay to accept the two majors for
debit cards. The fees totaled $19.7 billion
and averaged 1.63% of each sale last year,
according to the Nilson Report. Slightly
different treatment come to debit cards,
since they tap existing accounts and do
not involve loans.

OVERSIGHT COUNCIL

The Financial Stability Oversight Council
will be established as a super-regulator
that will monitor Wall Street's largest
firms and other market participants to spot
and respond to emerging systemic risks.
The USDept Treasury will lead the panel,
which includes regulators from other agencies.
Expect a Wall Street pedigree to occupy
the post. The objective is to monitor the
interconnection of highly leveraged financial
firms. With a two thirds vote, the council
can impose higher capital requirements on
lenders or place broker dealers and hedge
funds under the authority of the USFed.
The council also will have authority to
force companies to divest holdings if their
structure poses a grave threat to US financial stability. Abuse
is likely to become rampant as the council
can liquidate any firm that poses a threat
to the Wall Street syndicate, and cite any
credible diversionary justification. The
nine member council will include regulators
from the USFed, Securities & Exchange
Commission, Federal Housing Finance Agency,
Commodity Futures Trading Commission, and
other agencies. State securities, insurance,
and banking regulators and credit unions
won non-voting seats. The Federal Home Loan
Banks system, a financing co-operative for
mortgage lenders, is exempt.

BANK CAPITAL RULES

Bank capital rules will prohibit bank holding
companies from keeping less capital than
their bank subsidiaries. That will have
an impact on the use of trust preferred
securities, known as TruPS, but with a transition
period for large firms and grandfathering
of the securities for smaller lenders. The
industry must in time replace TruPS with
valid equity capital. Banks with assets
of at least $15 billion will be given five
years to replace TruPS with common stock
or other securities that count as capital.
Community banks that have raised cash through
TruPS since year 2000 will be given 20 years
to make the switch because most of the securities
have 30 year maturities. Around $45 billion
of the $150 billion in TruPS issued by US
banks have been packaged into Collateralized
Debt Obligations. TruPS will count toward
equity when calculating capital ratios.
Some bank officials expect lending to be
restricted by as much as $1.5 trillion as
result. US-based holding companies of overseas
banks must comply to the same capital rules
as domestic lenders.

US FEDERAL RESERVE LIMITATIONS

The US Federal Reserve will maintain broadened
supervisory scope but be subject to the
most transparency in its 96-year history.
All claims of threats to its political autonomy
and bank oversight powers were rejected.
Rejections are based upon nothing but continued
desired darkness to syndicate activity.
Chairman Bernanke will have a seat on a
newly created Financial Stability Oversight
Council. That board will encharge the USFed
to set tougher standards for disclosure,
capital, and liquidity. The USFed must endure
a one-time audit of emergency loans and
other actions taken to combat the financial
crisis since 2007. Much of the dirty evidence
will be deleted or obscured. After a two
year delay, firms will be identified that
borrow through its Discount Window and participate
in USFed purchases or sales of assets, such
as mortgage bonds. No removal of the USFed's
1978 monetary shield will come from examinations
of interest rate decisions. Fed governance
will prohibit commercial banks from involvment
in the selection of all 12 regional USFed
chiefs.

CREDIT RATING AGENCIES

Credit rating agencies (Moodys, S&P,
Fitch) will continue to choose the asset
backed securities they wish to provide official
ratings. Liability provision will continue
to make it difficult to sue these agencies.
Language redefined what investors must show
to prevent the dismissal of a lawsuit against
a credit rater. The SEC must conduct a two
year study on whether to create a board
to decide who rates asset backed securities.
The regulators will be challenged to arrive
at a better alternative. The SEC will be
in charge of monitoring the fiduciary duty
on brokers once the regulator completes
a six month study, regarding conflict of
interest declaration.

PRIVATE EQUITY FIRMS & LARGE HEDGE
FUNDS

Private Equity firms and large hedge funds
must register with the SEC, subjecting them
to mandatory federal oversight for the first
time. Their oversight will be more lenient
than for banks. Venture capital funds were
exempted from the registration rule, due
to their enterprise risk role. The PE firms
and hedge funds are subjected to periodic
inspections by SEC examiners. Any firm with
$150 million or more in assets will be covered
by the law. Funds also must hire a chief
compliance officer and set up policies to
avoid conflicts of interest. They must report
information to the SEC about their trades
and portfolios for the purpose of assessing
systemic risk posed by a private fund. All
data will be kept confidential, but can
be shared with the Financial Stability Oversight
Council. Registration rule compliance might
cost $500 million to the firms/funds in
the first year, said Judith Gross of JG
Advisory Services. Any fund that grows too
large or is too risky would be placed under
USFed supervision.

UNWIND OF FAILED FIRMS

Failed firms will continue to be unwound
and liquidated by the FDIC. Their reach
would now go beyond failed commercial banks,
with full power to unwind large failing
financial firms whose collapse would roil
the economy. My ongoing suspicion is that
the FDIC will be subject to Wall Street
pressures to eliminate rivals, however.
They have proven with past cozy asset deals
with major Wall Street firms to act as their
dedicated harlots. No protection exists
for this criminal factor. If such authority
existed in September 2008, then AIG and
Lehman Brothers might have been unwound
theoretically. A caveat though, since their
unwound would have brought about the collapse
of the US banking system. The costs of unwinding failing
firms will be borne by the financial industry
through fees imposed after a firm collapses.
The bill explicitly bars the use of taxpayer
funds to rescue failing financial companies.

RISK STAKE RETENTION

Lenders, with the exception of some mortgage
providers, must maintain at least a 5% stake
in debt they package or sell. The provision
is designed to prevent loan origination
in reckless fashion, only to ship off the
tainted loan products to an unsuspecting
investor. The rule will affect credit card
debt, car loans, mortgages, and other securitized
debt. Overall lending will be curtailed,
but with better lending standards. Lenders
must keep a stake in mortgages, an exception,
which contain risky features like negative
amortization, interest only payments, and
balloon payments. Loans guaranteed by the
Federal Housing Admin, the USDept Agriculture,
and USDept Veterans Affairs also will be
exempt from retaining risk.

INSURANCE INDUSTRY OVERSIGHT

A new Federal Insurance Office within the
USDept Treasury will be created to monitor
insurance firms. A study will come to issue
recommendations toward further overhaul
of industry regulations. Prevention of AIG
meltdowns is the motive, from unchecked
credit derivative counter-party acceptance
in contracts. Insurers, regulated by states,
must contend with a national watchdog. Great
confusion is assured, between state insurance
commissioners and federal oversight, with
multiple officials involved. However, a
national regulator may coordinate agreements
with counterparts in other countries. And
a national regulator can identify systemic
risks. Of course, a national regulator can
assist the Wall Street syndicate in covering
up the insurance games with credit derivatives.